New Delhi: The National Company Law Appellate Tribunal (NCLAT) has allowed withdrawal of Oyo's insolvency proceedings in a major setback to scores of hoteliers who had filed claims against Oyo Hotels & Homes following an insolvency petition in NCLT against the company.
The order was passed in the matter concerning Oyo and hotelier Rakesh Yadav. Oyo had reached an out of court settlement with Yadav but scores of hoteliers had approached NCLT with claims against the company that were said to be upwards of Rs 200 crore.
The Ahmedabad bench of the NCLT had ordered commencement of the corporate insolvency resolution proceedings (CIRP) against Oyo Hotels & Homes based on the application filed by Yadav. The proceedings were initiated under the Insolvency and Bankruptcy Code (IBC). While Oyo appealed against the NCLT order in NCLAT, and NCLAT granted a stay on the formation of the committee of creditors, the process of filing claims against the company had been allowed previously.
In an order on July 7, NCLAT has allowed Oyo's withdrawal appeal and the NCLT order has been set aside. The intervention of hoteliers is disallowed.
Pradeep Shetty, joint honorary secretary at Federation of Hotel & Restaurant Associations of India (FHRAI) which had also filed an application in NCLAT on behalf of its member hotels, said FHRAI will examine the option of filing an appeal.
"It is disappointing for hundreds of hoteliers whose claims could have gone into these proceedings itself and they would have got their dues," he said.
"If the intervention of hoteliers is disallowed, it would mean more hardships for creditors who have not been paid by Oyo for so many years. We are advising members to start filing their individual claims," he added.
Another hotelier said there are many matters filed with NCLT that were infructuous because of the Rakesh Yadav matter.
"So those matters should restart again. The hotelier claimants group is united and is considering approaching NCLT again," he added.
The court had concluded its hearings in the case which involved claims for payments from Oyo on June 23.
The order was passed in the matter concerning Oyo and hotelier Rakesh Yadav. Oyo had reached an out of court settlement with Yadav but scores of hoteliers had approached NCLT with claims against the company that were said to be upwards of Rs 200 crore.
The Ahmedabad bench of the NCLT had ordered commencement of the corporate insolvency resolution proceedings (CIRP) against Oyo Hotels & Homes based on the application filed by Yadav. The proceedings were initiated under the Insolvency and Bankruptcy Code (IBC). While Oyo appealed against the NCLT order in NCLAT, and NCLAT granted a stay on the formation of the committee of creditors, the process of filing claims against the company had been allowed previously.
In an order on July 7, NCLAT has allowed Oyo's withdrawal appeal and the NCLT order has been set aside. The intervention of hoteliers is disallowed.
Pradeep Shetty, joint honorary secretary at Federation of Hotel & Restaurant Associations of India (FHRAI) which had also filed an application in NCLAT on behalf of its member hotels, said FHRAI will examine the option of filing an appeal.
"It is disappointing for hundreds of hoteliers whose claims could have gone into these proceedings itself and they would have got their dues," he said.
"If the intervention of hoteliers is disallowed, it would mean more hardships for creditors who have not been paid by Oyo for so many years. We are advising members to start filing their individual claims," he added.
Another hotelier said there are many matters filed with NCLT that were infructuous because of the Rakesh Yadav matter.
"So those matters should restart again. The hotelier claimants group is united and is considering approaching NCLT again," he added.
The court had concluded its hearings in the case which involved claims for payments from Oyo on June 23.